Helen Kelly Speech To Labour Party Conference 2007

Speech of CTU President, Helen Kelly to NZ Labour Party Annual Conference 2007
Saturday November 3, 2007.

Kia ora tatou katoa

It is a great pleasure to convey very warm greetings from the New Zealand Council of Trade Unions – Te Kauae Kaimahi. In particular let me convey greetings from our Secretary Carol Beaumont, our Vice President Maori Sharon Clair and our Vice President Richard Wagstaff.

As you probably know this is my first address as President of the CTU to the Labour Party conference and it is the number one reason I had for wanting this job! I want to acknowledge Ross Wilson who is here today. Ross has been a great President of the CTU and representative of working people and has worked closely with the Labour government to achieve a great many improvements for working people. We will miss him enormously but are very pleased he will chair the ACC board where we know he will make a huge difference.

I thought today I would update you on what we are planning for the next couple of years. We have just finished our biennial conference and two very significant developments from that conference were the launch of our political campaign and the launch of our book on workplaces of the future. In terms of our political campaign – it is not just focused on the next election but obviously that will be a major focus for next year. We want to concentrate union effort and build a union wide campaign around three key policy planks.

The CTU has always run an election campaign but the scale of collective union effort next year will be much greater. We are undertaking research around our key themes and developing plans and resources to support union work on them. One of our key activities will be to get workers on the roll and out to vote.

The three themes of the campaign are:
• protecting and enhancing workers rights,
• stronger public services, and
• higher wages

These themes have both substance and values lying behind them – they have a practical element – we want for example to discuss a comprehensive bargaining framework which would offer more workers representation in the setting of their terms and condition than the current ERA and which would enhance workforce and industry strategies which are essential to economic transformation. But the themes also have strong values base behind them – they are based on our vision of a fair society where amongst other things work pays, social services like health and education are available to all regardless of income, and New Zealand is a peaceful society where all are treated with respect and are treated equally.

The CTU knows the values behind our policy planks are shared by the Labour Party and we want to work together to develop the detail.

The aim of the campaign is to build public momentum around these issues and to engage workers in political activity to both gain political commitment to progress in these areas and to expose those with agendas that are contrary to them.

I will come back to some of the issues that fit under these headings shortly. As I said we also launched our vision for a workplace of the future Te Huarahi mo nga Kaimahi. We think there are five features that will define decent work and the modern workplace. It will be high wage and high value; it will be highly skilled; workplace practices will be based on fairness and respect; industries will be well networked and play a constructive role within the industry to participate with social partners and the government to build the economy, the importance of public services will be understood; and it will be healthy, safe and sustainable.

The CTU has been extensively involved already in promoting this type of workplace through delivering worker training around productivity, the development of a learning representative programme, engagement in industry taskforces and groups set up by the Government like the food and beverage taskforce and the Growth and Innovation Advisory Board (GIAB) and through our work on Maori workforce development in the Hui Taumata. So we are not sitting still – we know that our economy needs transforming and for that to happen workers knowledge and skills need to be harnessed, their commitment gained and investment in workforce training needs to increase.

We know enterprise can take two approaches to competition – the low road where they compete on the price of labour, lobby for low tax, make short term investments etc leading to a low wage, low skill, low value economy, or they can take the high road approach of strategic collaboration, investment in training and investment in research and development which leads to a high wage high skill high value economy. We know also that it is in all New Zealanders’ best interest including business to take the high road. However we also know that without co-ordination of enterprise within industry and leadership of that approach – for each individual enterprise the prisoners dilemma applies which means they are incentivised to take the low road approach even when it is not in their own best interests – and we go no where fast.

So this brings me back to our three policy planks –and I want to talk about the detail behind one of the areas highlighted at least because I know you are considering a remit which is very much on this point and if carried leaves open the chance to talk about a coordinated approach across industries enabling them to take the high road.

The Employment Relations Act made a big difference to how unions operate and to the opportunities for collective bargaining for union members. We all participated in the development of that Act and it continues to provide a strong foundation for an IR framework. However it is now time to look at the outcomes from the Act – who has benefited from it and more particularly - who has not – and why this may not be the case. The union movement has grown since its introduction – 25% since 1999. But that increase takes coverage of New Zealand workers by unions to 22% and only 12% when the private sector is isolated.

We know that workers and industry benefit from union membership of good unions. We know that it is absolutely reasonable and dignified for workers to be part of a group that at its most basic negotiates their terms and conditions. We can’t be happy with so many workers not even being offered union membership. We run the risk that union membership becomes a privilege. So the question is why might this be – some will say unions are simply not doing their job well enough or that they are irrelevant to workers. That would be Nationals explanation for the union decline during the ECA days and that is what John Howard will be saying now in Australia. But what we know from New Zealand research on why people do or do not join unions is that a large number of workers would join unions but are never asked. The most obvious question that comes out of that is why haven’t they been asked and one answer in all likelihood is that there is no one to do the asking.

In the areas where there is low union membership, the unions working in those areas are using almost all the resources they have building strength for the members they already have or recruiting just to keep up with the turnover. Within the movement we have the absolute extremes of unions with 15,000 members and one single collective agreement and unions with 20,000 members and over 350 collective agreements. It is often this second group of unions that we are expecting to “do the asking” in those areas where workplaces are numerous, the industry voice is weak, the turnover is high and the workers are not your average full time permanent employee. If we leave it at that –many workers will not have the opportunity of being a union member.

So the big question then is does this matter? Well I say yes it does matter – it matters to the CTU and I will argue it matters for the Labour Party. If we agree workers benefit from representation, if we agree that in smart high performing workplace workers will be involved in innovation and productivity, if we agree that the right to collectively bargain is as important as all the other rights we seek to promote and protect then yes it matters. The ERA does provide benefits to union members – those that are in workplaces where there is a union – but it is insufficient to represent workers generally – where there is no union to do the asking and the nature of work in those industries is not conducive to union membership of a nature to enable a collective agreement to be secured. It is also the case however that greater benefits to both workers, industry and the economy as a whole would arise out of more industry based bargaining arrangements. It is ironic that so many industries are saying they are short of skilled workers when so few are prepared to discuss a floor of pay and conditions that can build the attractiveness and viability of their industry to potential workers.

The next question then must be what can we do about it? This really starts from an analysis of what is causing low membership and the lack of an industry approach to workforce development – it is our view that the current system is far too heavily reliant on enterprise bargaining. This reliance on enterprise bargaining immediately excludes workers in small business and in high turnover industries from getting organised to a sufficient level to enjoy collective bargaining or even union membership. Enterprise bargaining encourages competition using low wages as a competitive edge and at the other end discourages investment in training and workforce development in favour of workforce poaching. Anecdotally unions have trouble naming more than 1 or 2 MECAs that have been successfully negotiated under the ERA without a strong direction from government in some state sector areas. So for example we have a nurses MECA which is fantastic but in which DHBs were heavily encouraged to agree to. We have others again in the state sector settled in similar circumstances. But the only one I can name immediately in which a large number of original party employers were bought together in a MECA is the recently settled primary health care nurses MECA where the medical association (and industry body representing employers in the industry) took a lead role in representing the employers at the bargaining. Doctors responded to the NZNO claim for a MECA by establishing an effective and efficient bargaining process and a MECA was the result – what if they hadn’t – what if each doctor had, as many employers do, insisted on representing themselves – 620 employers – all needing co-ordination to bargain, all having to agree with each element of the agreement – there would not have been this MECA. So I can name one MECA– not enough and not what was anticipated in the ERA! And it is MECAs and industry agreements that will offer greater numbers of workers collective representation. So now what happens when a nurse gets a job in a PHO – there is a multi employer collective agreement – it is an industry standard – she can have a say in its development, she can join the union and gain coverage, she can move to the next PHO and know what the conditions are likely to be, the MECA can be used by the NZNO and employers to develop industry practice including training standards etc through the bargaining. They can address issues such as flexible working hours and paid parental leave and pay equity – issues of prime importance to a workforce with such a large group of women, they can use the MECA to make the work attractive and encourage workers to stay in the workforce in a area of extreme skill shortage. They can build in a career structure which encourages nurses to keep training and move about. It encourages all PHOs to take the high road and removes all incentives to take the low road. All benefit.

We need more of this. What is needed is greater support for industry level bargaining backed up by the solid floor of a minimum code for all workers. This industry level bargaining may need to take place at two levels – industry minimum codes, negotiated between employer organisations and unions at the industry level with institutional support to conclude, and MECA bargaining which will define subgroups within an industry on more natural groupings. At this MECA level very sophisticated forms of settlements could take place including agreements on investment in worker training and education, transfer provisions, promotion opportunities etc. We only have to look at some of our bigger industries where there is collective bargaining for large numbers of workers or in areas where MECAs are in existence to see the different level of sophistication in these agreements when compared to the myriad of enterprise and individual agreements most common in the NZ workplace. The only place where real discussions about industry development from a workforce perspective can happen on a sustainable basis is at the industry level and if wages and conditions of workers in the industry are unable to be discussed at that level – one of the most important components and levers for building sustainable industries is removed. The immediate reaction to this might be that the employer won’t wear it – but actually it is to their benefit as we know from other successful small country economies – and we see employers looking for frameworks under which to co-operate in other areas – industry taskforces, ITOs etc – every area possible except bargaining – to ignore an industry approach to the workforce is to ignore the elephant in the middle of the room. Some literature has been developed on the concept of “beneficial constraint” – it is in industries interest to have some constraints placed on their bargaining patterns including being involved in industry bargaining. We are advocating that a requirement to develop industry agreements will be a beneficial constraint on employers and on unions.

In the remit you are discussing and in the work the CTU has been doing – we have not been quick to suggest solutions. We haven’t proposed new institutions or rules be established. We are moving away from constant discussions on process and considering outcomes. Once we agree on what a modern workplace will look like – we can look at what processes will be needed to support that. What we do know is that in a modern workplace workers will have a voice, an interest in the success of the organisation or business and industry, and a future in the industry that is as good for them as it is for the employer.

The modern transformed economy will recognise workers as citizens with as much right and interest to participate in macro economic discussions as industry. Currently workers are a commodity – we treat them as citizens in their other life as tax payers and consumers but at work we contract them by the hour for their labour.

So why is this important to Labour? I realise I am preaching to the converted in this regard. Labour has a set of values that line up with what we are trying to achieve. Labour has recognised that there are two social partners it needs to work with in developing policy. We acknowledge and thank Helen Clark and her Ministers for the very serious acknowledgment they give the role of unions and for the in depth and very serious way you work with us. We know that we can talk about these issues and work together to discuss possible solutions. At its most basic our message is that New Zealand is a country where fairness underpins our identity. In this country we seek to provide representation and rights at large numbers of levels – in criminal law we provide lawyers, we provide representation to children in custody disputes, we have representative groups for people with various disabilities, we have groups like the School Trustees Association, Families Commission, Human Rights Commission, boards of trustees, hospital boards. It is not acceptable that we are complacent about whether or not workers have viable representation in regards to their work. As we know with all rights – they need to be accompanied by mechanisms that ensure they are attainable. This is trickier with collective rights and the jurisdiction in this area has often placed individual rights above those of the collective. Recently for example the Employment Court found the SFWU claim for a MECA with Spotless overrode the individual rights of employers to Freedom of Association! It even went as far as to say that the duty currently in the ERA for employers and unions to conclude enterprise collective agreements was a breach of the Bill of Rights, Freedom of Association provision, but that because Parliament had clearly intended this to be so, they would accept it – an employers obligations to collectively bargain with a union has been deemed a breach of an employer rights to freedom of association by our employment court. No regard was given to employees rights in international conventions to associate in unions and to collectively bargain. No consideration was given to the purpose of the law and whether or not a collective agreement is really an “association” or whether multi employer collective bargaining is actually the only mechanism that will in reality secure the right to associate in unions and collectively bargain in a modern economy for a large number of workers.

There are a number of options that need to be discussed to achieve the modern workplace and to ensure that workers are able to get effective representation by unions and collectively bargain. The outcomes are beneficial to all – workers and employers – collectively. The requirement to industry bargain is a “beneficial constraint” on employers and will not only secure real representation and collective bargaining for the large number of workers currently being denied it but will help us all build strong industries, decent wages and a modern workplace. We have international examples of this that reinforce this formula and the CTU also has a number of new ideas which should be explored in order to move in this direction.

The next point I want to touch on before I finish is the issue of tax cuts. An important part of our political strategy is strong public services. In part the momentum for tax cuts is being driven by low wages.

As union members we understand the benefit of collective effort and resources – that is why we join together in unions – we pay fees and act collectively to combine our effort in the knowledge that alone we will be unsuccessful and together we will be greater than the power of our numbers.

Tax is the same – we don’t want to pay for our own childrens’ education – when that happens, kids miss out – we want quality tax funded education. 1 billion dollars in taxes could pay for 10,000 more teachers or acres more national parks or the purchase of some of those camp grounds being closed down and sold or the building of more clean energy to reduce climate change or more funding to move aged care workers out of poverty wages, or closing the gender pay gap, or more for health care. Collectively it’s a lot – in a tax cut it is a small amount.

Workers certainly do not want cuts to public services.

So there may be tax cuts coming – but they must not undermine the public services we need now and in the future. And they need to be fair. And from a union perspective, we will continue to argue that the main problem with take home pay is the low wage paid by employers.

So I have tried to touch a bit more in depth today on a couple of key areas we will be working on and I hope it helps you with the industrial remits I know you are discussing.

We will be doing our best to get members involved in the next election and asking them to consider the policies of all the political parties against our election priorities and against the record of the parties in Government. We can look at the changes to working peoples lives under this government and while there is more that needs to be done , when you consider progress through the eyes of working people over the last seven years you can see significant change in a wide range of areas that make life fairer and better. These include

A billion dollars on new hospitals and cheaper doctors visits and prescriptions. Income related rentals for state housing. 20 hours free early childhood education and thousands of additional teachers in our schools. Interest free student loans and modern apprenticeships. Working for Families. Kiwi Saver. 4 weeks annual leave, 14 weeks paid parental leave, time and a half for statutory holiday work, a 60% increase in the minimum wage and now the removal of youth rates. ACC brought back into public control and worker participation in health and safety. Increased wages for workers like nurses, teachers and aged care workers. And the legitimate role of unions recognized through our Employment Relations Act including the right to protection from being unfairly dismissed.

For workers it is not just the fact that you have delivered improvements such as 4 weeks annual leave that is important. It is the values that such an action signifies. It shows you care about working people and the struggles they face.

We will be campaigning hard on our new policies but it would be without foresight and without hindsight not to compare this last seven years with the previous seven years and to spot the difference.

We also want to say that unions have played a large role in these achievements. From our industrial and political campaigns we have created the pressure for these changes and we have influenced how people vote to get a government that can and will deliver them. We have won things industrially that have gone on to be offered as part of our minimum code of employment rights, we have campaigned for the removal of youth rates, the defeat of the 90 day no rights bill, we have trained 14,000 health and safety reps, campaigned for high quality well funded public services and done lots more.

I want to thank you for this chance to address your conference. I want to wish you the best for the rest of your deliberations. I want to acknowledge the progress we have made – the CTU and the Labour led governments of the last 7 years – and I want to assure you that we have our plans and ideas in place to make sure the progress continues.